Limitations period; federal
tax deficiencies
SB 1201 provides for extensions
for the limitation period for proposing and assessing federal income tax
deficiencies based on federal limited consents executed by homebuilders and
outlines related claim procedures and policies, retroactive to January 1,
1993. SB 1201 has a proposed strike-everything amendment that would require
employers to pay employees due wages regardless of their immigration status or
national origin.
The alternative cost method allows developers to include, in the basis of properties sold, the estimated future costs of common improvements. The Internal Revenue Service (IRS) requires homebuilders wishing to use the alternative cost method to file federal limited consents. The requirement enables IRS to assess homebuilders for deficiencies arising from projects covered under the federal limited consent, specifically, the alternative cost method.
According to Arizona statute, a taxpayer may agree with the IRS for an extension or renewal of the period for proposing and assessing deficiencies in federal income taxes. If such an agreement is made, notices of a proposed income tax deficiency must be mailed within four years of when the return was filed or six months after the expiration of the agreed period for assessing deficiencies. The extension or renewal applies only to items specifically enumerated in the agreement (A.R.S. §42-1104).
SB 1201, retroactive to January 1, 1993, provides for extensions for proposing and assessing federal tax deficiencies based on federal limited consents executed by homebuilders and outlines related claim procedures and policies.
According to the Department of Revenue, the negative fiscal impact of SB 1201 is $3 million to $4 million in foregone revenues.
In March of this year, the Supreme Court ruled in Hoffman Plastic Compounds, Inc. v. National Labor Relations Board that the National Labor Relations Act does not protect illegal immigrants if they are fired for organizing a union.
In the case, a Mexican immigrant—Jose Castro—was living and working in the U.S. illegally, and had submitted false documentation in order to work at Hoffman Plastic. In 1988 the United Rubber, Cork, Linoleum, and Plastic Workers began a union-organizing campaign at Hoffman Plastic. Castro and other employees supported the campaign, and helped to distribute authorization cards to his fellow workers. Castro was fired in 1989 along with several other employees for their role in this organizing drive. In 1993 the NLRB found that these dismissals violated the NLRA, and ordered Hoffman Plastic to cease and desist from further violations of the Act. The Board also ordered reinstatement and backpay for Castro, and eventually determined that he was entitled to $66,951 plus interest.
However, the Supreme Court found that the backpay remedy was not appropriate, because Castro did not have the right to work at Hoffman Plastic in the first place, due to his immigration status. The Court voted 5-to-4 in favor of this outcome.